Cost of insurance keeping many Americans from replacing coverage lost in 2020

Nearly three in 10 Americans lost health insurance coverage in 2020, and more than half of them remain uninsured. According to a recent survey by ValuePenguin:

Twenty-nine percent of consumers lost health insurance coverage at some point last year. The loss of coverage was exceptionally high for those who were laid off or furloughed because of the coronavirus pandemic. Forty-seven percent of respondents fell within this category. Additionally, 39 percent of individuals who were able to keep their job but had their hours or salary cut also lost coverage. Those who earn $100,000 or more a year and those with a bachelor’s degree were the least likely to lose coverage, at 19% and 22%, respectively.

Related: 5 states with the most, least expensive health insurance deductibles

The main reason many lost coverage and remain uncovered is cost. Of those who still don’t have coverage, 42% said they don’t have enough money to afford premiums or the deductible.

• Other reasons why individuals are deciding to forego coverage include:
• Other expenses to prioritize (31%)
• Hoping to get a job that offers health insurance (20%)
• Haven’t looked into it because of anxiety (16%)
• Marketplace too confusing (11%)

Although some consumers turned to the health-care marketplace for coverage, it wasn’t without challenges. Nearly two-thirds (64%) of consumers who have purchased health insurance through the marketplace at some point encountered at least some issues doing so, including confusion about different plans and website crashes.

A major issue for individuals was the amount of time it took to evaluate plans. Three-fourths of respondents said it took them more than an hour to choose a policy and submit the accompanying application. Even more concerning, 7% said they spent seven or more hours completing the application process for marketplace health insurance.

Forty-five percent of marketplace users said the cost of that health insurance was higher than they expected. Forty-five percent of respondents felt they spent more than they would have thought on their new health insurance policy. Furthermore, younger individuals in our survey were more likely to say they overspent on marketplace health insurance compared to what they expected.

Consumers call for major changes to the marketplace, but they aren’t aligned on the level of choice. Although 38% of consumers who have used the marketplace believe there aren’t enough choices, but 33% said there are too many choices. Separately, 59% like having choices, but 29% would prefer a single option. One reason for this could be the variety of types of health insurance available, such as different provider networks and levels of coverage (catastrophic, bronze, silver, gold and platinum).

“As seen in this survey and the experiences felt by customers, purchasing individual health insurance can be a confusing and daunting process to undertake,” the survey report concluded. “However, knowing some of the basics about these policies and what to look for can make your shopping experience more manageable.”